House prices to drop 10% thanks to virus, warns OnTheMarket partner

A mortgage broker that’s just become a partner of OnTheMarket is warning that house prices are likely to fall 10 per cent over the rest of this year because of the virus crisis.

John Charcol is saying that the peak UK house price for 2020 is likely to be the one recorded in the March Nationwide house price index – already released – or in the price reflected next month by the government.s UK House Price Index.

Thereafter, Charcol’s mortgage technical manager Ray Boulger expects prices to fall 10 per cent by year end, with transactions tumbling in the next three months alone to a figure lower than that recorded at the worst depths of the 2009 credit crunch.

“It is clear activity in the property market will be severely curtailed, not only because of the economic uncertainty dissuading people from moving but also as a result of practical problems of surveyors visiting homes to prepare a mortgage valuation” he says.

However, if any silver lining can be found to the current crisis, it appears that first time buyers may be the beneficiaries eventually.

“Many people who had planned to move home this year will delay their move until conditions stabilise, not least because it will become very difficult to put property chains together” suggests Boulger.

“This will put first time buyers in pole position and so when they decide the time is right to buy, they will be in a very strong negotiating position to secure their first home at a good price, an advantage that will dissipate when the market begins to recover” he continues.

John Charcol has this month announced a partnership with OnTheMarket, meaning portal users will have access to digital tools and guides from the mortgage firm.

Luke Somerset, chief commercial officer at John Charcol, says: “We are delighted to be partnering with OnTheMarket. This latest partnership offers prospective homebuyers access to a leading property portal combined with expert advice when seeking a mortgage. Ultimately this will offer customers an effective and enhanced journey when purchasing a property.”